NOIDA (CoinChapter.com)— The US government might be getting ready to sell more than 30,000 Bitcoins that it seized from the Silk Road website. Though speculation at the moment, the move would not be new as the government sold over 9,860 BTC tokens just over a year ago on March 31.
However, the size of the sale this time around is much larger, which could end Bitcoin’s great bull run in 2024.
As news of the potential sale hit the wires, BTC price dropped to a weekly low near $65,140 before recovering slightly later in the day.
Silk Road Bitcoin Selloff May Hurt BTC Prices
The upcoming potential Bitcoin sell-off by the US government has investors divided. It is without a doubt that the sale of large quantities of Bitcoin by the government could have potential implications for the cryptocurrency market.
Such transactions can affect the supply and demand dynamics, possibly influencing Bitcoin’s price. However, the last time government sold Bitcoins, in March 2023, BTC price did not have much of a reaction to the sell-off.
Though the US government sell-off of potentially 30,000 BTC, currently worth nearly $2 billion, could be a bearish cue for the token, investors remain divided.
CoinMamba, a crypto trader, stated that the amount of BTC tokens the US government is selling might not impact much since the news of the sell-off did not have much of an impact.
However, another trader chimed in, stating that the sell-off would only impact the market when the US government’s Bitcoins actually hit the market. Hence, it might be too soon to speculate if the government selling its Silk Road Bitcoins might impact the token’s prices.
Yet, the news can not be interpreted as bullish for BTC price action in any possible way. However, if the BTC price survives the sell-off, it would highlight the resilience of the token, attracting investors to the market.
BTC Bulls Struggle To Stop The Bleed
Though Bitcoin price recovered some ground after dropping over 7.4% to reach a daily low near $64,500, the bearish pressure against the token remains high.
However, if the sell off continues, BTC price could drop to the 50-day EMA (purple wave) support near $62,630. Breaching the immediate support might force Bitcoin price to test the support near $57,000 before recovering.
Conversely, if the government selling its BTC tokens does not impact its prices, Bitcoin could target the 0.618 Fib resistance near $73,100. Breaking and consolidating above the immediate resistance might help BTC’s price rally to the resistance near $80,100.
The RSI for BTC remained neutral, with a score of 47.86 on the daily charts.
